Prices for ex-Brazil basic pig iron (BPI) have been corrected down over the past week as US buyers have been strongly insisting on a decline with the current worsening of expectations for the local scrap market. But no new deals have been reported so far. Even though offers have been corrected down slightly, customers are waiting for more decreases.
The latest offers for ex-Brazil BPI with 0.15 percent phosphorus content have been at $440/mt FOB for March shipment and beyond, down from official offers at $450-460/mt FOB until early February. However, even this price has not been acceptable for US buyers. “US mills will try to push down Nola [New Orleans CFR pig iron] prices as low as possible. Scrap is dropping and so is HRC. Political turmoil with the latest disagreement on further aid blocked by the Republicans will assumingly drag down sentiment and push buyers to the sidelines,” a trader commented. Market sources said that the current offers from Brazil are equivalent to $470/mt CFR, if adding freight, but buyers are trying to get levels at least $10/mt lower.
As reported by SteelOrbis last week, a few deals from a large trader for old-position cargoes were done at $465-470/mt CFR to a US customer. However, a few sources have denied this information this week, saying that the mill claimed it does not accept this level. One of the large market players said that the abovementioned trader is going to sell material in smaller lots from its warehouse.
Offers for higher grade BPI with phosphorus content of 0.10 percent and lower are still limited, and though still much above that for high phosphorus BPI. However, bearish sentiments have been putting pressure on prices as well with the highest possible price for the seller at $485/mt CFR, down by $490-500/mt CFR in late January.
The SteelOrbis reference price for import BPI price in the US, which includes pig iron with both high and low phosphorus content, has settled at $465-485/mt CFR, decreasing by $2.5/mt on average over the past week. The level has not been corrected down further, as the market is awaiting new deals and the settlement of scrap prices in the US next week.